Rivian Automotive Inc (NASDAQ:RIVN) shares continued to struggle in the wake of the company’s faux pas that saw it implement then quickly withdraw a price increase on pre-ordered cars.
The EV automaker increases the prices of its R1T pickup and R1S SUV models by $12,000 after they had already been pre-ordered by customers, leading to an outcry.
Rivian CEO Patrick Scaringe acknowledged the retroactive price increases had "broken the trust" of its customers.
“In speaking with many of you over the last two days, I fully realize and acknowledge how upset many of you felt,” Scaringe wrote in a letter to shareholders.
In initially announcing the increase, Scaringe said the price rises were a result of increased component costs in recent years.
“Since originally setting our pricing structure, and most especially in recent months, a lot has changed.”
“The costs of the components and materials that go into building our vehicles have risen considerably.
“Everything from semiconductors to sheet metal to seats has become more expensive and with this we have seen average new vehicle pricing across the U.S. rise more than 30% since 2018.”
The backtrack pushed Rivian’s shares down nearly 5% yesterday to US$50.91 as the EV maker both failed to improve its margins and festered feels of poor strategizing among investors.